If it overpaid to buy the rest of the Mexican brewer, Anheuser risked angering its own shareholders - who otherwise have a $65 per share offer on the table from InBev. Anheuser is expected to argue that InBevs offer undervalues the maker of Budweiser beer and that Anheuser will soon present its own strategic plan. That plan, which is likely to include the sale of non-core assets such as Anheusers theme parks, is designed to boost the companys share price, these people said. “We are committed to entering into a constructive dialogue with you to achieve a friendly combination,” Mr.
35 billion acquisition offer as early as this week, setting the stage for a hostile takeover battle for Americas largest brewer, according to people familiar with the matter. Anheuser declined to comment. For one, Anheuser wasn’t in the best position to offer Modelo much money. “The market reaction to our proposal has been extremely positive,” InBev Chief Executive Carlos Brito wrote to Anheuser CEO August Busch IV in his third letter in two weeks.
The status of those discussions is unclear. Modelo also is a fiercely nationalistic company that wants to remain independent. Louis giant. InBev first made its offer on June 11 and has spent the past few weeks trying to woo the brewers various constituencies, including its shareholders and hometown politicians.
To justify its rejection of the offer, Anheuser is expected to announce plans to increase the level of cost savings from its existing cost-cutting plan, known as Blue Ocean, to about $1 billion over the next four years from about $500 million, one person familiar with the matter said. , which could fetch $3 billion, people familiar with the situation said. If InBev took the offer directly to Anheusers shareholers and succeeded, the deal would count as one of the largest cross-border hostile takeovers ever and could embolden other foreign acquirers to pursue targets in the USOn Wednesday, InBev made its latest attempt to prod Anheuser into talks, telling the St. Busch indicated before InBev made its offer that he was opposed to a takeover of the company started by his great-great grandfather.
Anheuser’s Mr. Such a transaction would have probably entailed Anheuser acquiring all of Modelo, of which it already owns 50%. Mr. “Many of us are assuming the A-B deal is going to go through at a price above $65,” said Tom Pirko, president of California-based beverage advisory firm Bevmark.
Ultimately, the move isnt likely to deter InBev, which has put together a carefully crafted battle plan, according to people familiar with the matter. Also, relations between the brewers have been frosty at times over the years, mostly because Modelo executives felt Anheuser got half the company too cheaply. Mr. The company also is considering paying a special dividend to its shareholders.
Brito said in InBev, the brewer of Beck’s and Stella Artois, has already paid $50 million in fees to a consortium of banks that will lend it money to buy the storied St. Still, they say the Budweiser maker is likely to argue that $65 a share is too low a price, potentially saying its worth $70 a share or more. “If completed, a deal would create the world’s largest beer maker with about $36 billion in net sales. “As we’ve analyzed it and looked at [opportunities in] the international markets, we know it’s worth $70.
Anheuser also is expected to announce that its considering strategic options such as selling its theme-park business, Busch Entertainment Corp. Brito repeated promises that InBev wouldn’t close any Anheuser breweries in the US, would place Anheuser directors on the board of the combined company and would retain a large number of Anheuser managers. Many investors have expressed support for the bid, which represents a roughly 30% premium to where Anheuser shares traded before the offer. Anheuser-Busch CO is prepared to reject InBev NVs unsolicited $46.
“We believe this confirms our view that our proposal is the best way to achieve this transformational combination for all constituents.
